We have a universal life insurance policy (my husband & I) and keep getting letters from the insurance company saying that since interest rates are low , the premiums may not be enough to sustain the policy. I don’t understand this and was wondering if we would be better off cashing in the policy and doing something else with the money. Thanks for your advice.
Terry Says: Wow — you need some good advice and fast! I assume you still need this policy. Well, here’s how it has been working, or better — not working! It was “assumed” that there would be high interest rates on the money you deposited in the policy in premiums over the years. And that that interest would help pay the premiums in future years. But with low interest rates, either the premium will jump hugely — or the policy will lapse, and all the money you put in will be gone!
Go to: http://www.evaluatelifeinsurance.org/. This is a non-profit organization that can advise you the best route to take with your policy and your situation.